Let's get down to real basics: can Klein simply not tell the difference between Lewis, a bond salesman 25 years ago, and author/journalist since then, and a genuine in-touch expert on some aspect or other of modern finance?
Of course not, no. You want the guy to summon his own instantaneous disintegration as a trusted resource?
That said, while Smith's post is pleasingly grumpy, and while I'm inclined to a priori agree with its conclusions, it doesn't seem very convincing thus far.
Okay I take it back last few paras of Smith's post are good.
Totally off topic. I am at a bar right now, a somewhat homophobic aquaintance was just talking about how he's been living with his girlfriend the last few weeks. Him: " it's great she acts like a man. it's like fucking a dude with a vagina! ".
I boggle.
Why is that so puzzling? Coming from a general "homophobia as manifestation of patriarchy" perspective, I'd expect homophobia to be correlated with (a) having rather strong expectations of gender roles; (b) looking down on behavior coded feminine; (c) preoccupation with performing masculinity. "Fucking a dude with a vagina" gives you all the comfortable homosocial intimacy of your frathouse, without any anxiety about your own manliness.
But try to read that last comment as if it weren't so saturated with "I see people only as filtered through a thick web of theoretical presuppositions."
Why can't a woman be more like a man?
Yeah, I've heard comments like that a fair amount, and they go with a certain amount of hetero misogyny -- no man would want to associate with women, given how contemptible and annoying they are, if they weren't necessary for men to have hetero sex. So a woman who's like a man is a prize.
(This is a really dyspeptic way of putting it -- guys who think that way aren't necessarily particularly consciously misogynistic -- but it seems to me to be generally how it works.)
If you could make a man with a vagina, ovaries, a uterus, and three breasts all the misogynists would beat a path to your door
4 et seq.: Christ, that's repulsive and depressing. That guy could make a fortune directing beer commercials.
OP: I wonder whether I'm asking too much when I wish for a political prescription with slightly more detail than "We have to remove the criminals in charge."
10.2: I still don't see how no bank head is in jail. They didn't even try to get new management when they bailed out most of them. And I still don't see why, when the big mistake people point to is not giving billions to the one bunch of brokers who didn't get bailed out (Lehman), I'm supposed to be more worried about a recession than I am about going back to status quo ex ante.
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I am glad I am no longer the parent of an 18-month old.
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Too bad all the mortgage broker jobs for 19-month olds are gone.
Too bad all the mortgage broker jobs for 19-month olds are gone.
I've said before that babies are more work, but older kids are more frustrating. You deal with far more icky stuff changing a diaper than you do when your seven year old leaves old chewing gum on the seat of the dining room chair and you sit on it in your good pants. But even though the chewing gum is a smaller volume of icky stuff GODDAMN IT ARE YOU TRYING TO DRIVE ME CRAZY!?
At least babies are careful with used gum.
guys who think that way aren't necessarily particularly consciously misogynistic
For the record, I have a little trouble understanding a "misogyny" that isn't essentialist (women are always/mostly 'X' so these guys who don't like 'X' don't like women) or tautological/abstract (these guys don't like women, for any meaning of "women") or fiercely concrete and primitive (guys are scared of vaginas). Let's just say for the sake of argument that I have some trouble defining "women" in a non-reductive way and therefore have trouble defining "misogyny." Perhaps it might be useful to specify in any given case what it is "misogynists" don't like?
Unless, you know, this is just some kind of Foucaultian power discourse in which meaning and value is subsumed in the quest for hegemony, for which "women" is purposely undefined so "misogynist" is anyone we don't like or want to hurt.
Perhaps the problem is that bloggers don't read long things because they're too long? ...the paragraph about Klein by zung ending here did interest me.
Of course, I don't believe that accumulation of knowledge or info necessarily changes values, for example, if Klein read Econned he would believe, or publicly confirm the corruption in finance and economics that Smith and zungu do.
But then we have to ask why not, and what we can do about it. Is Klein "corrupt" in several senses, including the "Never expect a man to believe what will cost him money" (or whatever) sense? Is Klein aware of his corruption, is it deliberate?
That I find it easy to understand and accept Smith's analysis is very likely a corruption in me, a facile cynicism.
I have spent a lot of time watching four economists (DeLong, Krugman, Thoma, Quiggin) coming to grips with their bad analyses and try to change assumptions, paradigms. It is very difficult and challenging for them, and they spend a lot of time putting new wine into the old jars.
How does radical intellectual or ideological change in individuals happen anyway?
This reponse is pretty convincing. I was less impressed by the argument with Rortybomb in which her first point was that he was portraying her as a hysterical and irrational woman by saying she was "unhappy with" something.
20:There is a history with Konczal, pretty recent, involving his defense of money taken from Pete Peterson to come up with an "independent" deficit reduction plan. He is damaged, which makes me sad.
Smith takes a tone with Klein that goes beyond accusing him of ignorance, and probably implies a willful ignorance. (It is interesting that we avoid that accusation) Willful ignorance, performative belief or disbelief, interests me a lot. But you know that.
I literally cannot believe you just wrote that, bob!
I always think of Bob as a metaphor.
4: I've heard versions of this comment in varying degrees of seriousness and obnoxiousness from a few men. My attempt to unpack it would go like this: "As a man [says the man], I find it natural to like professional sports, outdoor activities, loose standards of hygiene and housekeeping and a certain degree of insouciance towards the various proprieties (family, respectful rhetoric, piety) that I must nevertheless propitiate in order to maintain my place in society. I enjoy the company of women, because sexuality is manifest in and on their bodies. However, the degree to which they do not share my proclivities as outlined above is troubling to me, because after all, a minimal amount of time is actually spent having sex, while the largest plurality of my time seems to go to maintaining the fiction that I'm not invested in all the things I've just outlined. Therefore, it's very refreshing when I meet a woman who shares many of my views on culture and daily life, and who herself invests but little energy into the stereotypical concerns of other women (babies, frilly things, cleanliness, popular culture with pretensions towards high-culture status). Because now I have a socially-acceptable sexual outlet AND I perform masculinity in a manner untroubled by concessions to femininity."
So in some sense, what we're talking about is not a pure misogyny, but more an attempt to assert masculine cultural mores over a space that is traditionally contested. The real flaw in the argument seems to me to be the essentializing view of stereotypical feminine cultural norms. Which is bad, but not perhaps as violently dehumanizing as what might be more generally implied by "misogyny".
Plus, most guys who would say that are just closet cases who would happily suck a cock if they could be assured that they would 'get away with it'.
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Also, I got the stank eye last night at a party for expressing my view that the 'bridge and tunnel crowd' has little redeeming social or cultural value, either to New York City or to our civilization in general. The counter-example of a Long Island-raised best friend that was offered turned out to be someone who now lived in San Diego, which I think just proves my point. Will anyone speak up for the bridge-and-tunnelites as a class?
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I think bridge and tunnel living is more environmentally sound than most other suburban living.
The bridge and tunnel crowd? What? Compared to what? The Tribeca-living banking crowd? Most of the cultural contributors in New York live in fucking Brooklyn and Queens.
27: I guess I am using the term somewhat imprecisely to refer to New Jerseyites and mostly Long Islanders, not including the boroughs.
I wonder whether I'm asking too much when I wish for a political prescription with slightly more detail than "We have to remove the criminals in charge."
The post is a response to Ezra, not a policy proposal in its own right.
What if the dude had said, "I've read that same-sex couples have fewer arguments over things like housework because they share expectations and communication styles on the subject. I'm really quite relieved that my partner has a more male way of communicating, because it makes daily life run more smoothly."
Would he be less misogynist or just more pretentious?
4 et threaded seq.: Pretty well captured in the disgusting banality of "Women can't live with them, can't live without them."
The problem with Klein isn't that he's corrupt, imo; the problem is that a post like that one is shallow and misguided. "Corrupt" might be an explanation for why it is that way. But the problem is that he claims no one could have possibly foreseen, etc, and that kind of claim is both wrong and dangerous. And Smith demonstrates that in spades, because that's what she's really good at.
The Smith/Konczal contretemps is of a different sort of thing, I think, and it's worth noting how shallow and content-free Smith's claims were there (especially given the vitriol of the post, and compared to something like her really well-cited and carefully argued screed against Klein). I mean, guilt-by-association is nothing but good fun (and institutional capture is a real thing that happens in the world), but I found it pretty hard, reading her post, to find anything in what the Roosevelt people had *done* to actually earn that level of bile. Anyone who takes money from a dubious source is worth scrutinizing a bit more closely, certainly. But her entire case was the taking of the money, and *not* the doing-of-something afterwards.
My estimation of Yves Smith's probity went way down after reading an exchange between her and the Economics of Contempt blogger (a lawyer practicing in securities law). See here and here, and the Yves Smith posts linked therein.
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FDL:brnaz and Marcy Wheeler in comments on the DSK case. Very very interesting. There is a lot going on here, for instance the prosecutor of the sex crimes unit (30 years) leaving the office after going so quickly and publicly on this case. This witness is so terrible (planted evidence?) that she will not be useful in any subsequent conspiracy cases. The various lawyers who represented her, and who they are connected to, bear looking at.
harpie at 8:48 has quotes and links. Check, Them. Out.
My feelings of unease were then increased by US Treasury Secretary Tim Geithner coming out to lead international demands for DSK's replacement - as the prosecuting authority, surely it would behove the US government to shut up until he has been found innocent or guilty? Since then I have been listening to Ghanaian radio (I am in Accra) where callers are more or less unanimous that as the woman is from Guinea, in Francophone Africa, the Sarkozy connection is to blame. That fact is certainly a boon for conspiracy theorists. [...]
Geithner was out there fast! And when Geithner talks, Obama and Goldman-Sachs, who is all over Greece and Europe, have their hands up his back. We will probably never know how involved Obama was in this conspiracy to change IMF heads and destroy an enemy of the vampire squid.
We can only pray the truth comes out.
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bizzah,
Ouch. Well, her book is still really good, anyway.
11
I still don't see how no bank head is in jail. ...
The primary reason is that the Obama adminstration made a policy decision to give everyone involved a pass.
A secondary reason is that stupidity is not in general a criminal offense. Also the banks were not the most culpable parties.
That said, while Smith's post is pleasingly grumpy, and while I'm inclined to a priori agree with its conclusions, it doesn't seem very convincing thus far.
I don't read Smith regularly, and I found the tone of the linked comment irritating in way that is familiar to coming into the middle of an ongoing blog conversation.
I thought that Smith was pretty clearly not actually responding to Ezra but just using his post as an opportunity to kick off a conversation about something she wanted to talk about.
I also though it was clear that the tone of Ezra's post wasn't "nobody could have seen it coming" but "the movie claims that 'anyone could have seen it coming' and that's clearly false." I haven't seen Inside Job yet (I may watch it this weekend) so I don't know if that's a fair criticism, but I can recognize that reaction (in particular I remember feeling that way on occasion after reading Chomsky).
I also thought Ezra's post was a little lazy, and not particularly well constructed, so I'm not surprised that it pissed some people off, but I feel like Yves Smith's response isn't, "come on, I know you're not this dumb, this is pretty lazy writing for you" it's, "aha, I always knew you were this dumb, now everybody can see that." Which seems unwarranted. But also makes sense if you don't see of it as a response, but just the opportunity for blog fodder.
Of course I had similar reaction to the recently linked criticism of the terrible SF-J essay on Addele, Beyonce, and Lady Gaga.
40.last: ...which also shows up in zunguzungu's last-Saturday links! And, scene.
I just read the linked zunguzungu post and it is amazing. I feel humbled reading it.
The quoted passages from the two linked articles on book and movie reviewing are great (and I appreciate seeing somebody else taking the anti-newness position more eloquently than I have managed to do) and the Gil Scott-Heron tribute was very nice.
the anti-newness position
Not that I'm actually anti-newness. Perhaps I would say that newness is overrated. It's slightly more complicated than that, but not particularly relevant. But I was amused by the quoted paragraphs.
40: I also though it was clear that the tone of Ezra's post wasn't "nobody could have seen it coming" but "the movie claims that 'anyone could have seen it coming' and that's clearly false."
Eh, where are you getting this from what Klein wrote? His contentions are pretty clear:
1. The financial crisis is the result of a series of nested errors/poor decision making processes.
2. While there were many people who were alarmed in the run up to the financial crisis, it's not surprising that they went unheeded, since none of them explained precisely how every aspect of it would unfold.
3. Ergo, there is no particular reason to hold anyone more accountable for the crisis, because no one was compelled to be more cautious, since there was no road map for crisis offered by the skeptics.
This is one of those arguments that seems, to me, to spring from easy access to the corridors of power. At this point in his career, it's easy for Klein to sit back and say "Well, after all, these people were only human, and you or I could just as easily have made the same choices they did, given the available information." Which tends to undercut the whole justification for concentrating power and wealth in the hands of a relatively small group of people, namely that these are the people who are best suited, by talent and temperament, to use that wealth and power wisely and for the greater good.
I don't see any evidence being offered that this argument is too complex for Klein. Rather, it seems like his defenders would give him a pass because it's understood that the genre in which he operates presupposes chumminess with powerful people and a thoroughly justified contempt for the vulgar squeals of the groundlings.
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Bruce Wilder ...is very smart.
Start:
The bourgeois takeover of gay rights took place a generation ago. The very fact that "gay marriage" is front-and-center as desideratum is a tribute to Republican conservatives like Andrew Sullivan. The HRC -- the brown-paper wrapper of gay rights organizations -- was always a rich man's club, and GLAAD was always about giving parties, and hoping celebrities would show up.Finish:
I don't see betrayal in the support for Cuomo. What I see is that those still playing the Game are still playing the Game. And, people, who, broadly, share my views, aren't. Maybe, there's some probably ephmeral self-deception at the margin -- people, who will do anything to avoid focusing on the logical implications of our economic situation and the economic policies pursued by alleged Democrats, celebrating a social and cultural advance. I understand: even if the ship is slowly sinking, jumping into the icy water doesn't seem all the appealing. And, up in the first-class dining hall, sinking is just a rumor -- only in steerage is anyone cold and wet.
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I'm oddly in agreement with both NickS and Natilo.
Klein's argument seems to trade on the notion that those in the best position to see the fiasco coming had every incentive to see it coming, and to protect against it, yet they did not! Which must show that it was effectively invisible.
One of the reasons I don't read Klein unless he's linked for some reason is that he doesn't write in a long enough form to do justice to his topic. The post in question could have been twice as long, and addressed the contention made in Inside Job (apparently - I haven't seen it) that the creators and manipulators of the financial products in question were intentionally blind to their risks.
As it stands, this from Klein's post:
"Inside Job" is perhaps strongest in detailing the conflicts of interest that various people had when it came to the financial sector, but the reason those ties were "conflicts" was that they also had substantial reasons -- fame, fortune, acclaim, job security, etc. -- to get it right.
is just glib. No, that's not why they were conflicts.
45: Some bourgeois revolutions are worth completing.
OT: I have visited the Great Orange Satan for the first time in, well, a while. I find this rather amusing thing, according to which, "In an effort to gain the support of political leaders, a coalition of unemployed Americans have filed paperwork to declare themselves the nation's largest investment bank."
Goldman was confident the group could prove incompetence of sufficient magnitude. "A lot of us voted for Republicans in the last election," he said. "If that doesn't show catastrophic incompetence, I'm not sure what would."
"Our plan is to start with one dollar, and use leveraged trading, sketchy hedge funds and outright fraud to make it appear on paper to be worth at least 1.5 trillion dollars. Then we'll flush that original dollar down my toilet, collapsing the whole thing. It will be a spectacular loss - a bajillion percent or so. Even Wall Street derivatives traders would be hard pressed to f--k things up as badly as we intend to."
Good to see they still have a sense of humor over there.
People are getting into too many details. The big problem with Klein's piece is the quick resort to argument from (presumed) authority and (presumed) expertise. (I realize that Smith gets into this.) Seriously, "if Lewis got it wrong, then what can we say" is a terrible, lazy, insecure bit of non-reasoning. Why not read reporters who can put things together for themselves, or at least think they can, rather than people who parade their ignorance and deference to (presumed) elites?
Also, Klein said some pretty stupid things about the bailout. Oh, and Lewis seemed to think the financial crisis was caused by the not rich enough trying to act rich and take out loans they couldn't repay.* They really took those sorry bankers for a ride.
And further, why did the biggest of the banks have an incentive to get it right? Because the execs lost their jobs and bonuses? Because JPMorgan and Bank of America and others were able to acquire competitors? Because the remaining banks have been left in stronger positions than before? The incentive wasn't so much to be right as to keep going all in and hope you could weather the storm (i.e. get bailed out, not allowed to fail).**
*Although Lewis probably deserves credit for succeeding in being incoherent, or at least not entirely clear in that piece.
**You could argue, if you were feeling conspiratorial, that there was an incentive for a Force of Evil type situation: get in a position to force the smaller banks to the wall and then takeover and go legit. Once the crisis happened, there was some evidence - I think the NYT ran a piece by Joe Nocera on some internal discussion at one of the banks about the upcoming acquisitions opportunities - that banks saw advantages in the situation, but it doesn't look like they were planning for it. Although if you look at financial history, it's something you should be prepared for as an ambitious banker. It's not like depression/recession-related consolidations/mergers have never happened before.
49.3: Well, right. Why Klein elides this is a mystery indeed.
49.last: There was a piece in the NYRB outlining the ways in which Citibank/Citigroup has been a key player and weatherer of storms like this numerous times in the past. I think it was by Paul Krugman and Robin Wells, but will have to check.
49
... Oh, and Lewis seemed to think the financial crisis was caused by the not rich enough trying to act rich and take out loans they couldn't repay.* They really took those sorry bankers for a ride.
In some cases this is completely correct. See here . There were many culpable parties and the numerous people who got mortgages based on fraudulent loan applications should certainly be included.
Klein's citing the fact that Lewis didn't forsee the crisis is pretty silly but a lot of criticism of Lewis just seems like jealousy to me.
There was a piece in the NYRB outlining the ways in which Citibank/Citigroup has been a key player and weatherer of storms like this numerous times in the past.
Here. I just read that today and thought it was very good and pointed even by Krugman's standard.
Whatever the deeper story, however, Madrick's subtitle gets it right: what we have experienced is, in a very real sense, the triumph of Wall Street and the decline of America. Despite what some academics (primarily in business schools) claimed, the vast sums of money channeled through Wall Street did not improve America's productive capacity by "efficiently allocating capital to its best use." Instead, it diminished the country's productivity by directing capital on the basis of financial chicanery, outrageous compensation packages, and bubble-infected stock price valuations.
I also thought the article on Paul Bowles was excellent and touching, but it appears to only be available in the print edition.
Also, to answer Natilio's question:
Eh, where are you getting this from what Klein wrote?
I take that from the opening sentences
I finally watched "Inside Job" this weekend. It was an excellent documentary for people who don't want to understand the financial crisis but want to believe they would've seen it coming. Watching it, you'd think that the only people who missed the meltdown were corrupt fools,
I have no idea why it irked him so much but, at this point, I have some sympathy. As I said I've definitely had that reaction before, "it can't possibly be as cut and dried as you're making it out to be because that just wouldn't make sense."
For that matter I took his digression about Michael Lewis as less an attempt at "argument from (presumed) authority and (presumed) expertise" and more a hasty attempt to elaborate on his own initial reaction. I'd guess that he picked Lewis as the first name that came to mind.
Now it's possible that I'm being too generous and that I'm completely wrong in my reading of his post, but I just took it as random griping, rather than a serious argument.
I know it won't happen, but I would like to see EK revisit that post at some point. I do feel confident that he could do better with more effort and attention.
NickS, Ezra's opening sentences strike me not as setting out what he thinks the thesis of the documentary is, but as being an extremely snide knock on the doc's presumed audience as a bunch of superior know-it-alls (or rather, woulda-known-it-alls).
NickS, Ezra's opening sentences strike me not as setting out what he thinks the thesis of the documentary is, but as being an extremely snide knock on the doc's presumed audience as a bunch of superior know-it-alls (or rather, woulda-known-it-alls).
You could be right.
Honestly, I like Ezra's writing enough that I'm inclined to believe the explanation that I just described which is that he's being lazy and cranky, but I'm certain that's the case. I can just say that was my first-read impression of the post before I saw any of the critiques and it still seems plausible to me.
It reads likes a knee-jerk response to what he registered as conspiracy theories.
There's a lazy argument that's come up in arguments about academic economics that boils down to "hey, they're smart people and it's complicated stuff." Klein's post seems to be the journalistic version of that.
Anyway, here's his argument when the bailout almost but didn't quite happen yet that we should just give the bankers what they want 'cause they'll be fine either way - you see, this bailout is for our own good. Now, the bailout does seem to have worked (for certain values of work) and there were good arguments for it, but it was also one of the few chances where they might have been a chance to negotiate stronger conditions on what the banks needed to do to get government backing. But hey, bankers have many options and you don't, so just give in. That's some nice analytic thinking right there.
I don't know why I'm so cranky about this. I usually defend his reporting - when it's looking-into-something reporting - although I haven't read him regularly for a couple of years.
I just re-read the piece and . . . I'm not sure.
Look at a paragraph other than the opening one:
There's a lot to dislike about Wall Street. The pay. The culture. In many cases, the people. But that doesn't explain what happened in 2007 and 2008. A lot of observers understood we had a housing bubble -- Dean Baker, for instance, had been sounding the alarm for years -- but few of the housing skeptics saw everything going on behind the bubble: That the subprime mortgages had been packaged into bonds, that the bonds had been sliced into tranches, that the formulas being used to price and rate the tranches got the variable expressing correlation wrong, that an extraordinary number of banks had purchased an extraordinary amount of insurance against getting that correlation wrong from AIG, that AIG had also priced the correlation wrong and would be unable to pay its debts in the event of a meltdown, that a meltdown would freeze the mostly unregulated shadow market that major financial institutions and players used to fund themselves, that the modern financial system was so fragile that an uptick in delinquent subprime mortgages could effectively crash the global economy.
Natilio and Yves Smith are inclined to read that paragraph as saying that nobody, "of them explained precisely how every aspect of it would unfold." I can see how you would get that reading from the long list of specifics in the middle of the paragraph.
I'm inclined to read it as, "There's a lot to dislike about Wall Street. The pay. The culture. In many cases, the people. ... A lot of observers understood we had a housing bubble ... but few of the housing skeptics saw ... that the modern financial system was so fragile that an uptick in delinquent subprime mortgages could effectively crash the global economy."
In that reading the opening list of reasons to dislike Wall Street isn't a way of implying that the critics of Street are motivated by personal dislike, instead it's a way of conceding that there was a lot of behavior that was obnoxious and or criminal but doubting that knowing about the bad behavior would give anyone enough information to predict the magnitude of the crisis.
I'm inclined to that reading because it matches my own experience. I believed there was a major housing bubble since 2004, but I never thought it was going to crash the entire economy.
I thought it would end up more like the Dot Com bubble in which a lot of people would lose money and it would modestly harm the economy.
56.2, on the link to the Klein piece on the bailout: his tone was different then, wasn't it.
That sounds like hand-wringing over the fact that we peons are not in fact in control of the situation. There's some very fine parsing to be done about the extent to which we can in fact regulate global financial markets for the greater good any more, at this point, but I actually can't fault Klein for saying that it doesn't look good. They really did have us by the balls, and still do.
Given that, before the modern regulatory system set up during the 1930s, there were periodic crises, panics, crashes, and depressions, then you would think that an outflanking and dismantling of that system would lead to a situation where you're likely to get another crisis, maybe even periodic crises again. The point of setting up a regulatory structure that guards against crises is not to specifically target one particular type of crisis and then guard against just that one, but to create a broader sound basis for banking. You don't actually need to know that it was going to be a housing bubble that ultimately took things down to think that, hey, maybe it would be a good idea to have a regulatory system like that.
58:I have hated and feared derivatives and like instruments for at least 5 years before the crash, and remembered how they brought down ? (LMTC or whatever) a hedge fund with a sterling reputation in the 90s.
They were and are the problem they allow unaccountable, uncontrollable and incomprehensible leverage. They, not the actual loans, are why the Euro banks needed bailing out from Greek exposure, because no one knows how far it could fall. No one knows.
And Goldman-Sachs instruments hid much of the Greek exposure in the first place, and allowed Greece to overborrow.
Sorry, they are poison, and the fucking global banking system is still a zombie.
59: Eh, I do think we were going to get the bailout we got and that no other, less banker-friendly options were on the table, as they were beyond the Overton Window bounds of acceptable discourse. I just didn't like the way he set it up to be about personal feelings about the banks. This is probably petty and resentful of me.
Also, bailout week was where it became clear the Obama's administration was going to do pretty much what it's done with respect to finance, but we could still hope a little back then.
I read the article in 56 differently: not that he was saying we had to give in without conditions, but that having no bailout -- which House Republicans were engineering because they wanted a crisis -- would hurt ordinary folks way worse than it would hurt banksters. The (seeming) enemy of you enemy is not your friend.
Adding to the comment about discourse in 62: the votes weren't there for anything better, either, if I remember correctly.
Heh. I'm registering 60 as a bit of a slap in the face: of course! We can in fact assess past crises, rehabilitate the regulatory measures that had been dismantled, set up new ones, and so on. The people who know and do this stuff do actually know about it.
We might need to assassinate all the Republicans first.
note to CIA or FBI or whoever: The foregoing has been written as hyperbole and in jest. No assassinations are or will be planned or executed.
There's an essay in a recent Economist explaining that after WWII banking was so regulated and dull that everyone with savings kept them national, while inflation gnawed away the war debts (and long-term savings). They seem to say that this was a pretty good deal for everyone except the unpatriotic rich, and therefore can't possibly be returned to.
Sometimes I think the Economist is sending up lefty action plans in a thin scrim of deniability.
63: There is that side of it too, yes. But I don't think not having a bailout at all was likely at that point.
I'll stop after this, but I should add that this kind of post was more why I was reading him regularly back then. But since everybody else seems to read the one I linked earlier differently than I did, it will probably be taken as evidence against him.
I'll stop after this, but I should add that this kind of post was more why I was reading him regularly back then.
I like that post, and this bit
This is why I argued yesterday that what we're seeing is bigger than the bailout. No one quite knows how to harness our political system in opposition to major problems.
Is pretty stark.
it will probably be taken as evidence against him.
No, it reads like Ezra Klein as we once knew him.
If I see a change between the one linked now in 67 and the one linked in 56, it's only a growing awareness of the sheer extent to which we might just have to wholly capitulate in order to lessen suffering. Something like that.
Anyway, now that Klein's writing for the WaPo, he can't write stuff like that.
68. Stark but true. And truer now than 3 years ago.
66: Krugman also periodically comes back to the dull banking theme too. Or the Canadian banking theme - he seems to love the "worthwhile Canadian initiative" joke.
As an ordinary, small-time individual consumer, or patron, or whatever, the conservatism of Canadian banking is surprisingly visible. (Presumably it's even more visible at the investing level; I wouldn't know.) Cash deposits are just about the only thing that go through instantaneously. Everything else - even government and large bank-backed student loan checks, etc. - take a week or more to clear because they do all kinds of double-checking and stuff. Cash back with a debit card is not a routine function at the grocery check-out (but I think it may be possible), there aren't as many things you can do with a credit card - the one I was looking at treated bill payments as cash advances, not normal credit - and so on. If I weren't a student, I'd be paying a bunch of fees just to have the unlimited transactions type of account too.
Of course, there are only like 5 major Canadian banks and relative to the rest of the economy they're pretty much in too big to fail territory. But it appears that means that they're also too big to be lightly regulated.
there are only like 5 major Canadian banks
Bank of Montreal. Bank of Nova Scotia. Imperial Bank of Commerce. Royal Bank of Canada. And the TD (formerly Toronto Dominion Bank, now retooled as the TD Bank to remove all obvious suggestions of its Canadian and commonwealth origins [but with the same damn logo!] in order to aggressively pursue the American market: they're all over northern New Jersey now...).
No one quite knows how to harness our political system in opposition to major problems.
I've been engaging in a reverie.
"Mommy, why can't we harness the political system?"
Well, Johnny. First of all, with respect to the financial system, we need to return ourselves to some of the regulatory structures that had been in place, and add some more.
Why can't we do that?
Right. That's because big money controls too much of the power in our country. In order to address that, we probably need campaign finance reform. That's a big hairy mess.
We can do it, mom! Why not?
It's complicated, Johnny. We would need to do several things: one of the reasons we in fact haven't been able to reform campaign finance is, well, the Supreme Court, lately anyway. It was pretty bad prior to recent Supreme Court decisions, but we still need to think pretty carefully about the Supreme Court now. Another is the redistricting process, though that's not finance per se, but the way states contort arrange themselves.
[I've kind of crapped out here: there are more items on the list of things that should be done.]
We could also talk about abolishing the filibuster, Johnny, but in all honesty, I think we need that: it's a necessary stopgap measure in time of need. What we want to do is make sure we don't even need to filibuster in first place.
"Mommy, why can't we harness the political system?"
Because a major faction thinks, correctly, that they'll be rewarded for failure.
And because even if the entire world must be destroyed, it is worth it to them if they can vanquish the goddamn hippies.
I may never understand why everybody hates the goddamn hippies. What is the problem?
I've heard some of them play loud music and walk around naked.
Then again, those are good things.
OT: taking a nice bike ride to meet up with neighbors & friends for a beach BBQ in beautiful weather is fucking awesome. Yay for summer!
Megan does not represent all hippies.
Beach barbecues, yay. Glad you're getting on well in your new home.
I'm finally learning what people are referring to when they complain about summer weather in DC. It's not quite as bad as I was expecting (so far), but also pretty incredible after living the last two years in almost entirely sub-75/80 degree weather. I think the milk I bought was at risk of going bad on the walk back from the grocery store.
It hasn't been very bad this year so far; wait a bit, alas. Tomorrow's supposed to be a little grim.
t's not quite as bad as I was expecting (so far)
So far is the operative phrase. DC summers are miserable. Just for comparison, today in NYC was perfectly pleasant - high eighties, a bit too warm in the direct sun at the hottest point of the day, otherwise quite nice, and only moderately humid. I hope you don't have too wear a suit too work. Your shirt will be sheer by the time you get there most days.
Though apparently DC summers are not as bad as in the real South. I always hear about how people move from the northeast to the South because of the weather. Proof that Americans are crazy. NE winters aren't too bad with just a couple bad weeks, NE summers can be relied on to have a few horrible weeks. Southern summers are apparently horrible week in, week out, from early May to early October.
I feel like the 'the banksters are CRIMINAL' argument is just some lazy morally labeling. Without watching the film, i'm pretty confident that criminal statues are for the things little people do.
We could also talk about abolishing the filibuster, Johnny, but in all honesty, I think we need that: it's a necessary stopgap measure in time of need.
What could be better than requiring a supermajority in an already undemocratic branch of congress? Let's just go all out and require 2/3 majorities on everything so that the rest of the country can turn into a governmental paradise like California.
58: A lot of observers understood we had a housing bubble ... but few of the housing skeptics saw ... that the modern financial system was so fragile that an uptick in delinquent subprime mortgages could effectively crash the global economy.
So, are we just arguing about that final clause? Because yeah, ok, there weren't too many people who were saying "even a very minor increase in delinquencies in subprime loans could be enough to burst this bubble." Rather, a LOT of people were saying "at some point, there will be enough delinquencies to burst this bubble." This is where I think Yves Smith's criticism kicks in. There were plenty of people, apparently including both myself and NickS, who very clearly saw that the bubble was a bubble, and that, like all bubbles, it must eventually burst. And I think Klein is indeed saying that this simply doesn't matter, because financial professionals are never obligated to listen to any critique unless it comes in the form of a hyper-detailed hypothetical play-by-play. And that is absurd. I don't think I'm constructing a straw man here. I think that is what Klein is actually advancing, and I think the reasons for it go back to what I conjectured above.
Well, the Klein topic is covered, so I'll just have a hearty laugh at this, from the first item in the zunguzungu link post:
"Reviews are the product of a Protestant society, and like the New Testament they tell us time is infinite. "
Ummm, what?
81
... NE winters aren't too bad with just a couple bad weeks, ...
More like 6 bad weeks, January to the middle of February. And that's in Ossining (near NYC) presumeably things are worse further north and inland.
83, 86: On abolishing the filibuster, I'm sure you know the counterargument, that in some godforsaken land in which the Michele Bachmanns/Rand Pauls/Grover Norquists of the world rule the roost, we'd need the filibuster as protection.
Wasn't it one Sen. Jeff Merkley of Oregon who had a filibuster reform (not abolition) bill on the table a while back?
Googling tells me yes. There are a ton of links out there on it, but here's Kevin Drum's helpful recap. We really don't necessarily need to abolish the thing outright; it's short-sighted to think so.
The counterargument is idiotic. If we don't want the other side passing shitty legislation than we should try actually being a party people want to vote for for. I don't know how anyone could look at the application of supermajority rules in CA and the Senate for the last 20 years and still think it's a good idea.
Seriously, though, when you figure out how to make us the party people actually want to vote for, let us know.
'cause I kind of thought we did that with Barack Obama. For a brief period of time. You'd have to tell me how we fucked up in the 2010 midterm elections.
But sorry, I've just realized that 92 and 93 are not really relevant to the scenario gswift is speaking to. Apparently he is saying that if we find ourselves in the minority party, we don't deserve to have recourse to the filibuster, because we'll have deserved to have the majority party's legislation rule, because we couldn't convince enough people to vote for us.
Good grief.
93: "We" fucked up in the 2010 midterm elections because of the supermajority requirements. In 2008 the voters voted for change, and they didn't get it, because the supermajority stymied it.
The system can't work with supermajority requirements, because in that scenario, the voters can't hold anyone responsible. If they elect Michele Bachmann President, and she fucks everything up without a filibuster, then the voters can vote her out again.
I'll give that some thought, but since I've otherwise become a tad irate, I'm off for a while.
If I'm reading him right, parsimon, he's saying that the filibuster is a profoundly anti-democratic feature of an already anti-democratic legislative body. And he's saying further that there's lots of real-world evidence to suggest that super-majority requirements lead to political paralysis and hyper-partisanship (he may not be saying that; I don't know). I'd say that he's certainly right on the former count, but I'm not sure he's got the causation right on the latter. Regardless, it's a horribly stupid thing, the filibuster is, and it should thrown in the Potomac. If it swims, burn it. If it sinks, oops.
If it swims, burn it. If it sinks, oops.
Wait, I thought trials by ordeal worked the opposite way?
If Michele Bachmann becomes President, the degree of fucking up that would ensue would be too great.
I would like someone to please tell me why the Merkley filibuster reform proposals linked in 88 are insufficient to protect against its abuse.
In 2008 the voters voted for change, and they didn't get it, because the supermajority stymied it.
I think this is correct as far as dealing with the economy, but insofar as health care was an electoral issue, you can say that Nancy Pelosi led the House to put accomplishment over electoral safety.
Writing this out makes me less certain of it than I when I started, though.
93
'cause I kind of thought we did that with Barack Obama. For a brief period of time. You'd have to tell me how we fucked up in the 2010 midterm elections.
People weren't voting for Obama, they were voting against Bush. So Obama gets in and mostly continues the Bush policies with the addition of a health care bill that was and remains unpopular. So people continued to vote against the in party.
Our coalition includes a bunch of people who don't vote in midterms.
I don't know how many people voted for Obama in 2008, and then for a successful Republican challenger in the House in 2010, but I bet the number is pretty low. Maybe some did because they didn't get "enough" "change" -- but this requires operating at a level of irrationality that's hard to deal with. And are probably offset by people who voted for the Republican because Obama was providing too much "change."
95
... In 2008 the voters voted for change, and they didn't get it, because the supermajority stymied it.
They didn't get it because it turned out Obama wasn't very different from Bush.
103
... Maybe some did because they didn't get "enough" "change" -- but this requires operating at a level of irrationality that's hard to deal with. ...
What's so irrational about voting for the in party when times are good and the out party when times are bad?
Ignoring all causality? Rewarding an out party that works towards failure? Putting in the people who will make things worse when times are bad?
(I don't mean to suggest that I think irrationality is anything but pervasive. You can't tailor a political approach to it. Only a policy approach: there is no issue more important for the Admin for 2012 than employment. If they think any different they are fools. They show all signs of being foolish.)
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Ignoring all causality? ...
Questions of causality are very complicated, it is unclear if the average person can properly evaluate them. Results on the other hand are more obvious. And like Eisenhower said :
I would rather have a lucky general than a smart general ...
107
... You can't tailor a political approach to it. ...
Isn't that what you just claimed the Republicans were doing?
... Only a policy approach: there is no issue more important for the Admin for 2012 than employment. If they think any different they are fools. They show all signs of being foolish.
They chose to spend their political capital on Obama care, it is too late to change course at this point even if they wanted to.
I don't mean to suggest that I think irrationality is anything but pervasive. You can't tailor a political approach to it.
"I welcome their hate!" ...FDR
"Hopey-change, maybe, if the Republicans are ok with it." ...Obama
Isn't that what you just claimed the Republicans were doing?
Block everything, and call the guy ineffectual. An ineffectual socialist. Not really available to the Democrats.
it is too late to change course at this point even if they wanted to.
I don't agree with this. If the economy is visibly improving in the summer of 2012, Obama will benefit. He can rely on luck, or he can try to help it along. He cannot get there with austerity. As I think about it, luck is probably all he's got on this front.
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I don't agree with this. If the economy is visibly improving in the summer of 2012, Obama will benefit. He can rely on luck, or he can try to help it along. He cannot get there with austerity. As I think about it, luck is probably all he's got on this front.
Luck is all he's got because it is too late to try to help it along. Which is what I said.
Too late because frustrated voters put people into office who (a) have nothing but bad ideas and (b) don't want success anyway.
But he's been a lucky fellow much of his life, looks like.
Since the friends with whom I was supposed to spend the 4th of July this evening called an hour ago to cancel because their AC went out this afternoon -- understand, it's like a freakin' swamp weatherwise here today -- entertain me! With a political fight! or otherwise.
On the political front, I'm with 101 and 103.1. CharleyCarp's Our coalition includes a bunch of people who don't vote in midterms gets it right.
There are a lot of reasons parties lose elections -- the spread of misinformation by the opposition party, with everything that entails, springs chiefly to mind -- and supposing as gswift apparently did in 89 that it's as simple as that they weren't good enough to vote for is facile.
I haven't read, or don't remember, the Merkley proposals, but I have read some fairly persuasive arguments that if the purpose of the filibuster is to put a brake on precipitous majorities and to encourage deliberation, then there are ways to do that don't turn into all or nothing situation. For example, you could require multiple votes at decreasing threshholds: if a bill fails to get 60 yays, it goes back for more discussion. Next time it needs 55, then if it doesn't get that, more discussion, then a majority threshhold. With some amount of discussive time required between each vote.
Of course for 50+1 policies that aren't broadly popular, this will favor a disciplined party that will keep on voting the same way, but we can all hope, along with hoping for a pony, that the time it takes to get through that sort of policy will be used to oppose it and maybe convince someone to stop it. Meanwhile, more popular stuff with 55+ votes can actually pass.
There's a link to an explanation of the Merkley proposal up at comment 88.
Short form:
Merkley's proposal revolves around a single principle: the Senate should always allow debate. So the filibuster should be banned entirely on motions to proceed and on amendments because both are things that promote debate and engagement. Filibusters would still be allowed on a bill's final vote, but it would take more than one senator to launch a filibuster (Merkley suggests a minimum of ten) and senators would have to actually hold the floor and talk. No longer would a single person be able to obstruct all business just by dropping a note to his party leader.
If you think about the ways in which Republicans have lately abused the filibuster, well, they keep things from proceeding, from opening for debate, in the first place. Getting rid of that means the public at large, which mostly doesn't pay attention unless there's a hoo-haw, might actually hear about this stuff.
I've been rude to gswift, but he's certainly right that public opinion is important, yo.
103
Our coalition includes a bunch of people who don't vote in midterms.
2006 was a midterm also and the Democrats won 233 seats (a gain of 31). In 2010 they won 193 seats (a loss of 63).
I wish you would spell out the conclusions you think we should draw from these facts, James, instead of assuming that the conclusion is clear.
Luckily, in 2006 the other fellows were pretty demoralized.
While I'm sure there are voters who actually swing from one party to the other, I think they are far outnumbered by people who show up, or not.
Old people vote more reliably than young people. White people more reliably than people of color. Rich people more reliably than poor people. I don't think this is particularly controversial.
Each race has its own dynamic, of course. Obama's loss was fairly narrow here: did the incessant radio ads saying he was going to take everyone's guns away play into that?
It won't be close next time. But maybe enough people will ticket split so we can keep Sen. Tester.
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I wish you would spell out the conclusions you think we should draw from these facts, James, instead of assuming that the conclusion is clear.
That it is not inevitable that the Democrats will lose seats in midterm elections. So perhaps their poor performance in the 2010 midterms had some connection with their poor performance in office.
This is somewhat remarkable, and even on-topic: Rand Paul declares his intention to filibuster the raising of the debt ceiling. Unless a balanced budget to the Constitution is passed! Funny guy.
This was at 10 a.m. US time East Coast. The rest of us were watching Djokevic beat Nadal at Wimbledon.
121
Luckily, in 2006 the other fellows were pretty demoralized.
Which is consistent with my point, that the Democrats won because people were mad at Bush not because people had any great enthusiasm for the Democrats or their agenda.
parsimon -- I think one way to state the argument against the filibuster is to ask, if you were writing a constitution from scratch, would you include it? I think most people would say no.
My sense, for example, is that most European countries don't have a filibuster mechanism, but they do have broader constitutional guarantees of human rights. That seems like a better arrangement.
Now if you think that amending the constitution is impossible, and want to have a filibuster rule as additional protection the next question, as gswift brought up in 83, is why have the senate be the body with super-majoritarian rukes? Why not the house? The Senate is already less acountable in that it over represents smaller states, and the terms of office are longer.
But of course not even the Framers contemplated putting the filibuster in the Constitution. Which is to say, there's no need to amend that sacred document in order to do away with the filibuster. The Senate just has to vote to change its rules.
true, true. Replace "constitution" with "rules of government" in my comment.
I'm not convinced that I should have capitalized "Framers". But I worried that if I didn't, you all might have gotten confused: "Does he mean that guy with the beard who owns that shop on Main Street? The one that sells art supplies and offers fine framing?"
I don't think we're particularly disagreeing, Shearer. It's irrational to blame Obama for the conduct/policies of McConnell, but there we are.
128: sorry, I didn't mean to pick nits. I'm just bored and morbidly fascinated by parsi's defense of something that seems well and truly indefensible to me. I mean, I suspect there's a good argument in favor of the filibuster -- beyond Tevya or Chris Dodd or whomever bellowing, "Tradition!" -- but if so, I haven't heard it. The notion of checking a runaway majority seems odd, given that we already give Wyoming and Charlie's excuse for a state 2 senators.
Oops: I meant, "Charley". I probably misspelled "Tevya", too. And I'm not even drunk, I'm afraid.
if you were writing a constitution from scratch, would you include it? I think most people would say no.
I'm out of my depth here, to be honest, but I'd had the impression that it was supposed to be a protection against what's sometimes called the tyranny of the majority.
I don't know a thing about the origin of the filibuster rule(s). Though.
The House is a fucking zoo, and seems actually less accountable, on a seat by seat basis, than the Senate. I would not want to see a filibuster provision in the House: its composition is too wildly variable.
If we're going to speak on this level, I feel like we'd need to go back to the Federalist Papers.
On preview: Yeah, I clearly don't know enough about the origin of the filibuster. What was it supposed to do?
Why are there two Carolinas anyway? "Alabama" and "Mississippi" -- and dsquared thinks Canada is the hoax?
I thought the runaway majority notion went back to the 19th century, and sort of ties in with the idea of allowing unlimited debate in the Senate. I don't particularly care for it - if there's going to be a runaway majority for something bad, it's probably going to get more than 60 votes anyway - but you know, acknowledging the other side's points during an argument and all that. It's possible I was mislead that this was a concern by my high school history/civics teacher, who was clearly conservative but took the "my goal is for students not to be able to guess my affiliation" approach.
And then years of grad school never covered the filibuster specifically, except as it relates to taking over other countries.
I'm properly chastised, by the way, for just not knowing the origin of the rule or what its rationale was intended to be, yet defending it.
Before WWI, debate was unlimited, and any one senator could stop it. A small group were preventing US from getting deeper into WWI, so the majority (and MT Sen Walsh was a key player in this) set it up so that 2/3ds vote ended debate. The rules have been modified slightly since then.
Lesson: you want filibuster reform, filibuster something that Capital wants.
134: now you're talking. Also: two Dakotas! 4 senators for 1.5 million people. Come the fuck on, already.
130
I don't think we're particularly disagreeing, Shearer. It's irrational to blame Obama for the conduct/policies of McConnell, but there we are.
I think most people believe (correctly) that the President of the United States has more power and influence that the Senate Minority leader. And hence is more responsible if things are going badly.
Obama's military and economic policies are basically the same as Bush's. The main thing he added was an unpopular health care bill. Why shouldn't people be unhappy?
except as it relates to taking over other countries
I mean, if there can be two Carolinas, why not a "South Florida" in Nicaragua? With more than 5m. people, they should have, what, 8 senators?
136
I'm properly chastised, by the way, for just not knowing the origin of the rule or what its rationale was intended to be, yet defending it.
It's just an outmoded custom that the House sensibly got rid of over a hundred years ago. Senators like it because they are all egomaniacs and like being able to throw effective temper tantrums.
Obama's military and economic policies are basically the same as Bush's.
This strikes me as being approximately as subtle and accurate as the Times story today that likened downtown Detroit to a Midwestern Tribeca.
Obama is compelled to execute McConnell's economic policy. Which is the same as Bush's. Military policy is different, but maybe not different enough for the casual observer.
The President does not have more power and influence over the Senate Republican Caucus than the Minority Leader does, and thus as to anything that requires legislation -- eg averting worldwide economic calamity next month -- the popular perception of who has more power is simply not correct.
The same would be true of military policy, if McConnell wanted to change it: he could shut off the Libya war in a heartbeat, if he wanted.
The region around every directionally named college and/or university is hereby declared its own state!
I really think there should be a Northeastern South Dakota State U.
145.last: He couldn't have started the Libya adventure. That takes a president.
145
Obama is compelled to execute McConnell's economic policy ...
This is utter BS. Obama was not compelled to reappoint Bernanke and generally continue the Bush response to the financial crisis. He was not compelled to prioritize his health care bill over fixing the economy. Nor was he compelled to continue the Bush tax cuts.
I'm in a tent in my in-law's backyard because five is apparently too young to sleep outside alone.
REI makes a quality tent, should you be in the market, but the ground is stupid hard.
149 -- I was thinking of the tax cuts, and not going for a real stimulus in 2010. I think McConnell prevented both. WRT the Bush tax cuts, I don't see what you can possibly mean. The President's plan -- a partial extension -- got "only" 53 votes in the Senate. Or was it 54?
Look folks, the filibuster is very simple. It exists because they can. The Senate is a deliberative body of very powerful very independentactors with zero zero rules from outside the consensus. Difi and Boxer represent more people that live in most nations of the world, what they should fucking obeyReid or Obama?
As soon as you realize that Senators are not functionaries or bureaucrats, but the leaders of nations (would you tell Obama to STFU?) you give them a little respect and accept that they each can and fucking should shut the whole country down just to let us know they are there and that they will not kiss ass.
152: The tax cuts were going to sunset. All he needed to end them was enough votes to sustain a veto. Of course, that would have ended all the cuts, not just those on the wealthiest.
Moby, REI also makes air mattresses, if you're too sissy otherwise.
154. Right. Couldn't have his policy. Could only have McConnell's, or a policy that would be a disaster both economically and politically, which he liked even less. That's real power.
A Senator is and should be very very powerful, the pork she delivers should and does deliver thousands of jobs and billions of dollars to their states. That is also a great responsibility. They are not twiddling their thumbs out there, they are serving huge constituencies whose welfare depends on them. They are local, not national, and have zero national concerns, other than overlap and pleasing their voters.
The good leaders like Dirkson and LBJ knew how to bribe these motherfuckers, and made sure taxes were high enough to have the slush funds to work with. Senators can be fucking bought, it's easy but expensive.
or a policy that would be a disaster both economically and politically, which he liked even less.
Bullshit.
Bob, James, Von, Mobes: I'm sure you all join me in wishing Sen. Baucus every happiness with his new bride.
Houseguests are back from Idaho (there's a good story about how we ended up independent from Idaho) and I need to pay attention to them. Au revoir.
An idle thought on this from Charley's 137:
137.last: Lesson: you want filibuster reform, filibuster something that Capital wants.
You know, the latest Rand Paul foolery I linked in 124 fits that bill. It would be interesting to see if establishment Republicans might finally decide that they've had enough of Tea Party dementia (a brand apart even from their own dementia). I tend to think the establishment does indeed want to raise the debt ceiling, and not at the cost of the ridiculous balanced budget amendment Paul is calling for in exchange, which isn't even possible in the time-frame in question.
Eh. Paul will just be reined in somehow.
because five is apparently too young to sleep outside alone
Apparently?!
Also, why have both a Virginia and a West Virginia? I vote to amalgamate, and give the extra two Senate seats to New York.
why not a "South Florida" in Nicaragua?
Or a "North North Dakota" in Canada? This might help improve the US Senate, actually, though I doubt the citizens of Manitoba and Saskatchewan would ever go for it.
156
Right. Couldn't have his policy. Could only have McConnell's, or a policy that would be a disaster both economically and politically, which he liked even less. That's real power.
So you think the Bush tax cuts were a good thing?
The Democratic position that taxes should have been cut for everybody but the very rich is just their usual class war posturing, it was never a realistic possibility and I don't believe they were serious about it. They could however have just let the Bush tax cuts expire (thereby raising taxes on everybody and not singling out the rich). I don't think this would have been all that bad economically or politically. And in any case the economic and political consequences have to be compared to the current situation which does not appear to be developing in a way that favors Democratic goals.
Incidentially the current debt ceiling fight is something the Democrats could have easily avoided by raising the ceiling by an adequate amount when they had control of Congress.
I still do not understand how believe the strategy of letting the Bush tax cuts expire at the same time as putting forward the ones that Obama campaigned on and let the economic terrorists defeat them was a lose.
just their usual class war posturing
It's astonishing how you can spoil an otherwise entirely sane and critical comment with just the tiniest bit of nuttery. It's like a tincture.
And he's saying further that there's lots of real-world evidence to suggest that super-majority requirements lead to political paralysis and hyper-partisanship (he may not be saying that; I don't know). I'd say that he's certainly right on the former count, but I'm not sure he's got the causation right on the latter.
I don't think it's causative. But man it annoys me that anyone thinks it's a good idea to have rules that enable crazies to take the country hostage. I feel like we're all on the Chappelle bus with the masturbating hobo. Rush Rand Paul! He can't come on all of us!
159: Sure, but I fell asleep. Apparently, I don't need an air mattress.
I didn't even know he was getting married, but best wishes to the couple.
165
It's astonishing how you can spoil an otherwise entirely sane and critical comment with just the tiniest bit of nuttery. It's like a tincture.
The Democrats could make the case that the Bush tax cuts were a big mistake that contributed to the financial crisis, that the government does a lot of good things that have to be paid for, and that the Clinton years were not exactly an economic wasteland. Evidently they have no confidence in their ability to do this.
So they revert to the taxes should be raised on the rich because rich people are evil argument. This may play well to the unfogged readership but not so well to the wider public. It is obviously politically driven (rather than by considerations of what is best economically). It implicitly concedes that taxes were too high under Clinton and that Bush was correct to lower them with only some tiny quibbles about the distribution of the cuts.
And it wasn't even so smart politically. Once the Democrats ruled out letting the Bush tax cuts expire full extension was inevitable and their alternative proposals were just a charade which they knew had no chance of being enacted. And Obama comes across as a guy who can be pushed into folding a winning hand.
Btw what's with this executive jet tax loophole nonsense? The Democrats expect us to believe that the difference between depreciating executive jets over 5 years instead of over 7 years is worth defaulting on the national debt. This is the hill they want to die on? Are they insane?
The Democrats could make the case
You correctly pointed out above that voters are not interested in causality, or in close and confusing analysis, just results. There's no case making: only people already plugged in pay attention to cases. There is only a status quo, which, had the tax cuts expired, would be that (a) people would be paying higher taxes, and see this in every paycheck; (b) the increase in taxes would have a slightly recessionary effect; (c) the decrease in long term indebtedness would have no short-term economic impact whatsoever; (d) we'd still have the whole debt ceiling deal; and (e) we'd have the Boehner tax cuts coming up for veto.
Nobody is dying on the hill that is the jet depreciation rules.
And Bob is certainly right about the lack of leverage over senators like Nelson of Nebraska. He doesn't have to answer to Reid or Obama, and there is no chance, none at all, that a more progressive senator could beat him in a primary and go on to win a general. You can keep him in the caucus, and have his vote more often than not, or you can drive him to the other party and have his vote never.
The primary route didn't work in Connecticut, and Nebraska is not Connecticut.
All talk of some moment when Democrats had the ability to pass strongly opposed legislation is crap. They always had to make deals.
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Nobody is dying on the hill that is the jet depreciation rules.
Obviously not so why are the Democrats even bringing them up? Why stake out a position that will be immediately overrun?
So they revert to the taxes should be raised on the rich because rich people are evil argument.
No they don't. They argue that taxes should be raised on the rich because rich people can afford it better than poor people. This has been a recurrent principle of taxation in democratic polities since ancient Athens. And nobody is suggesting that David Koch be charged 50c in the dollar on every dollar he earns; they're suggesting he be charged 50c on every dollar he earns over the first million per annum or whatever unimaginable sum of money is being bandied about.
Are you pretending you don't understand marginal rates?
Who are you listening to James, who is bringing this up?
172
All talk of some moment when Democrats had the ability to pass strongly opposed legislation is crap. ...
They passed the health care bill which was strongly opposed and unpopular with the public as well. They could have passed something else instead.
The Democrats expect us to believe that the difference between depreciating executive jets over 5 years instead of over 7 years is worth defaulting on the national debt. This is the hill they want to die on? Are they insane?
I find it very hard to believe that this is a good-faith argument, so the fallacy doesn't really need spelling out, but for the record:
It's the Republicans who are holding the hostages. The positions aren't symmetrical. The Democrats aren't the ones saying "The kid gets it unless you sing Dixie for me while wearing only a thong and a tiara."
And the Democrats have so little self-respect that they'd do even that if they could just be sure the demands would then stop. They don't want to die on any hill. What's preventing them from acceding is simply the knowledge that it wouldn't do any good. (If once you have paid him the Danegeld, you never get rid of the Dane, etc., etc.)
You might not have noticed that the health care bill was a compromised mess.
On the tax cuts I am closer to Shearer than Carp, although the situation was hopeless after the midterms, and Obama should have gone with Pelosi in January 2009* and let them all expire.
Democrats tax everybody, the rich more than the poor, but tax everybody...and then use the money to give them jobs building the commons. NASA, Highway System, military, etc. This is what Dems do, tax and spend, and they have to damn well sell it.
*Because of the GFC and Lesser Depression, and some major confusion among New Keynesian economists, this would have been a hard sell in January 2009. Pelosi wanted to try, but for whatever reason, this is not who Obama is.
Democrats tax everybody, the rich more than the poor, but tax everybody...and then use the money to give them jobs building the commons. NASA, Highway System, military, etc. This is what Dems do, tax and spend, and they have to damn well sell it.
Dead right.
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BTW keep masturbating to Barack Obama.
(But not Anna Massey.)
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177
And the Democrats have so little self-respect that they'd do even that if they could just be sure the demands would then stop. They don't want to die on any hill. ...
So what the Democrats (Reid and Obama) should do then is say this:
It is clear the Republicans aren't interested in a compromise bill but default would be disasterous for the country. So the Senate will pass and the President will sign whatever debt increase bill the House comes up with. But it should be clearly understood that the contents of the bill are entirely the responsibility of the House Republicans. And if the public doesn't like the contents there will be House elections in 2012.
But it should be clearly understood that the contents of the bill are entirely the responsibility of the House Republicans. And if the public doesn't like the contents there will be House elections in 2012.
Yes, and saying it will make it so.
Sigh, I wished we lived in a country where the government got to do what they actually wanted to do so that we could stop having stupid arguments about what everyone "really" wants. Our constitution sucks.
For the record, I think James is mostly right on his analysis -- just that describing it as "class war"... well, this comes to mind.
(By the way, that's my new little nerdy project -- feel free to submit at the link.)
James is right that raising taxes on the rich only is more politically palatable than letting the whole enchilada expire. It's pandering, sure. But as far as class war goes, it's like a raspberry against a massacre.
He belonged in the class with Folk and LaFollette, Roosevelt, Seth Low, and Walter Fisher. He was on "our side," the people's; that was why the other side, the plutogogues, called him a demagogue. But I heard some of Tom Johnson's campaign speeches in the infamous tent he moved about for meetings in parts of the town where there were no halls or where opponents closed halls against him. His "circus" speeches were indeed entertaining; he encouraged questions from the floor, and he answered them with quick wit and barbed facts; but those political meetings were more like classes in economics and current (local) history than harangues.
The only just complaint of his enemies was that he "had gone back on his class." This was said by men who almost in the same breath would declare that reform was not a class struggle, that there was no such thing as class consciousness, no classes, in America; and they meant it, too. The charge against Tom Johnson, Folk, LaFollette and, later, Rudolph Spreckels, of treason to their class, is an expression of our unconscious class consciousness, and an example of our appalling sincerity, miscalled hypocrisy.
most European countries don't have a filibuster mechanism, but they do have broader constitutional guarantees of human rights
Like the right to free speech, which our mandarins have determined rules out effective public financing? Put not your faith in courts.
The main problems with Parsi's belief that the filibuster prevents tyranny by the majority is: 1- the blunt truth that human history is 99% tyrannity by the minority; 2- the refusal to acknowledge that failing to act is itself the enactment of policy: the status quo. The powerful, almost by definition, are those who have prospered under the current rules; the status quo bias built into a supermajoritarian system is fundamentally a conservative bias, allowing the powerful to consolidate their gains. If you look at its history, that is what it has traditionally been; that is what it is now; that is what it will continue to be.
The Merkley proposals still seem to allow indefinite delay, so long as you're willing to actually read from the telephone book or something. I just don't see the point. No one actually listens to Senate debates; that's not where the public sphere lives, to the extent we have one. The Merkley proposal is just another attempt to pretend that the filibuster is about deliberation rather than status-quo-preservation and power it gives to individual senators to claim tribute, as potential veto points. But the deliberation worry is pretty easy to defuse without supermajoritarianism: just institute a waiting period, where a bill has to be passed in identical form X weeks/months/whatever later before it takes effect.
I agree with Shearer that the administration has given up on doing more about the economy, but I just don't see how there was any real possibility of trading off healthcare for more stimulus, or even for getting more/more left-wing Fed governors confirmed (which I tend to think, with Yggles, was perhaps his biggest fuckup).
As for the unpopularity of the health care bill--you do realize that when questioned about the *substance* of the bill, it's basically only the mandate that's unpopular, and that, overall, public opinion is considerably to the left of the status-quo here?
187.1: I can't say that I'd be willing to trade European free speech protections for U.S. ones. You can get sent to trial in parts of Europe for just talking and that seems a huge problem for me.
183
Yes, and saying it will make it so.
Maybe not but currently the Republicans seem to be setting things up so the Democrats get blamed for all the unpopular cuts that the Republicans want.
178
You might not have noticed that the health care bill was a compromised mess.
So maybe it wasn't worth doing. It did (according to Nate Silver) cost the Democrats some House seats.
175
Who are you listening to James, who is bringing this up?
Yglesias has had at least two posts and Talking Points Memo has had at least one . And apparently it was in recent Obama speech (which I didn't listen to).
When Obama puts something a speech and suddenly the liberal blogs are full of it I tend to think it is a Democratic talking point.
188
... but I just don't see how there was any real possibility of trading off healthcare for more stimulus, or even for getting more/more left-wing Fed governors confirmed (which I tend to think, with Yggles, was perhaps his biggest fuckup).
Well you can't get governors confirmed that you don't nominate. I think the biggest problem is that Obama isn't interested in economics and hence is reluctant to devote a lot of effort towards trying to fix the economy. I reviewed Obama's book "The Audacity of Hope" here and noted:
There is very little if anything relevant to the recent financial crisis. Obama just doesn't seem very interested in how the economy works or how the government might help it work better. So I don't think prospects for major financial reforms are very good.
Obviously not so why are the Democrats even bringing them up? Why stake out a position that will be immediately overrun?
Because the Democrats are trying to demonstrate to the public just how whacked the Republicans' priorities are. Do you have a better idea of how they could do that?
zunguzungu is excellent. But, it is such a time drain. He always has too much information that I want to read. Darn him for being too interesting.
I am not sure how true it is to say that most European countries don't have a filibuster. Certainly it is bad form, and certainly the majority does have the right to put the question, but at the same time, bills do get talked out. The Labour lords filibustered the PR referendum act, for instance, and it would have been almost impossible for the Tories to move cloture. (In large part thanks to the crossbenchers.)
Here in NZ, the Labour Party is filibustering a private members bill on voluntary student association membership (don't ask.) It isn't a government bill, so it is very much easier, but I think that almost any determined opposition in any legislature can delay any single given bill almost indefinitely if they are willing to really commit to fouling up the parliamentary machinery.
What European countries tend not to have is an easy automatic filibuster.
197: What European countries tend not to have is an easy automatic filibuster.
And the easiness in the Senate helps skewer the public debate (especially when it suits the status quo as respected by the media). Like how the ACA is regarded as having "squeaked through" the Senate at 60-39.
Reading that Brooks column that's making the rounds is deeply depressing. The two possible outcomes are the Republicans wreck the economy (more) or complete capitulation by the Democrats followed by a celebration of the grownups in charge of the Republican party.
Have to say I'm with Shearer here. I'm not a fan of the filibuster either but it's a major cop out to say that Obama was held prisoner by McConnell hence couldn't do anything. McConnell is a superb legislative strategist but Obama had significant power that he didn't use at key points. He outsourced economic policy to a mix of the 90s Clinton team and the NY Fed leadership, not the folks to be aggressive in taking on a Great Depression-level economic catastrophe.
There will be no filibuster reform, certainly not this session. The Dems are likely to be in the minority in 2012 and know it. Being in the minority sucks in the House, not so much in the Senate, and the filibuster is why.
There were many culpable parties and the numerous people who got mortgages based on fraudulent loan applications should certainly be included.
James, people have always been inclined to defraud lenders, which is why lenders have traditionally been very careful. Sure, if you want to put some borrowers in jail, that's okay with me, but it's going to be hard to separate genuine criminals from the ones whose lenders asked them to lie on their applications, or the ones where the lenders themselves filled in the false applications.
The problem was systematic, and it wasn't in any meaningful sense a problem with borrowers. Until you understand how lenders' incentives changed, you're not going to understand what happened, and you're going to continue to blame people who were (in many cases) victims rather than perpetrators.
A fool and his money are soon parted, unless the fool was too big to fail.
I just don't see how there was any real possibility of trading off healthcare for more stimulus,
If James wants to persuade us that Obama was too distracted by healthcare to get what he wanted to aid economic recovery, he first needs to make the case that Obama didn't get what he wanted to aid economic recovery. Obama made a request from Congress, pushed it hard, pretty much got his way, and bragged about it on that basis.
People finally seem to understand this about foreign policy. They get the idea that Gates and other Bush-era figures were appointed by Obama because he approves of the jobs they did. People need to understand that Bernanke's reappointment was also no accident.
51: In some cases this is completely correct. See here . There were many culpable parties and the numerous people who got mortgages based on fraudulent loan applications should certainly be included.
The link you provide is about a single house, and the article was written in 2007. Do you have any facts to back up your assertion, besides anecdata?
39: Also the banks were not the most culpable parties.
How do you figure this? The banks (and their officers and trustees) had a fiduciary responsibility -- to their lenders, to their borrowers, to their depositors and to the FDIC -- that they abrogated, and that abrogation was, insofar as we can tell given the paucity of investigative resources, often quite willful. It's all very cute to keep repeating "stupidity is not a criminal offense", but overwhelming negligence on the scale perpetrated by many US banks during the last decade certainly is a criminal offense.
Of course, there is plenty of blame to go around here, no one's disputing that. But your constant drumbeat of accusations against individual house buyers is perplexing to say the least. None of these house buyers could have orchestrated this if a whole host of institutional actors -- the federal government, the banks, the real estate agencies, the mortgage brokers, the insurance companies, the stock analysts, etc. etc. -- had not created the conditions that allowed for both fraud, and more often, greediness and poor planning that fell far short of fraud. And even if we do put some of the blame on individual buyers, it is still the case that the people involved in the institutional malfeasance were the ones who were HIRED SPECIFICALLY to prevent this kind of thing from happening.
39, 204:
This is why it's so important to separate the questions "who is morally to blame?" and "what caused the problem?". Someone who conspires with their loan officer to lie to the bank to buy a house they can't afford is morally culpable. And I would say they're more morally culpable than the loan officers who encouraged them.
But obviously borrowers did not suddenly become more greedy or evil. What happened is that some decisionmakers at some banks decided they could make some money by allowing borrowers to screw over the investor.
An illustration (which actually happened to me): If I leave my car in a sketchy part of town with the GPS mount clearly visible, and return the next day to find some broken window glass and no GPS, I don't think you'd say I'm morally culpable for the larceny. But it was my negligence that precipitated the crime.
To be clear, bankers did not suddenly become more greedy or more evil either. There was a confluence of circumstances that made originating, securitizing, and holding dodgy mortgages a more appealing option than it had been in the past.
We can use the phrase "allowing borrowers to screw over the investor", but in no way should that imply that more than 1 borrower in 100 were even aware that "the investor" existed, let alone wanted to make any effort to screw anybody.
Someone who conspires with their loan officer to lie to the bank to buy a house they can't afford is morally culpable. And I would say they're more morally culpable than the loan officers who encouraged them.
I think the borrower approaches the loan officer in the same way that the taxpayer approaches the accountant. As someone who is expected to get the best deal possible for the person paying him, who can be counted on to not break the law. The borrower doesn't know what constitutes breaking the law. The loan officer does.
Further to 205, I think some people make the same error when talking about the behavior of people who are assaulted in certain circumstances (especially women). It ought to be obvious (though unfortunately it is not) that you can say behaviors X,Y,Z are high-risk and it's advisable to practice caution, without saying that you were asking for it if you do X,Y, or Z.
207: Most people have a good idea how salespeople get paid. People who lied about things like their income and assets were perfectly capable of understanding what was going on, whether or not they wished to do so. Just like they could figure out what's going on when someone asks to be paid under the table in cash.
I except people with so strong a language barrier as to make it actually impossible for them to understand what they were signing. Or otherwise incompetent to understand the contract.
I would agree that mortgage brokers ought to act as fiduciaries toward borrowers (whether or not the law requires it), and that they are morally culpable for selling people bad deals.
Also:
We can use the phrase "allowing borrowers to screw over the investor", but in no way should that imply that more than 1 borrower in 100 were even aware that "the investor" existed, let alone wanted to make any effort to screw anybody.
They understood that money was changing hands, right? And that the loan officer was not actually lending them the money personally? And that the forms they were filling out were being sent to some third party? Not that hard to connect the dots if you're actually interested in doing the right thing. Which most people aren't.
Yes, most of us understand that the money is being loaned by a bank. A bank, not an investor.
211: The bank is not the same person as the loan officer, and obviously if whoever holds the money were ok with the borrower's actual income/assets/whatever then why were they being asked to lie?
I am not saying that the borrowers were the main problem. What I am saying is that the system was set up in a way that reliably made people act immorally,.